AACS Responds to Proposed DOE Gainful Employment Regulations

 Last Friday, the White House and U.S. Department of Education simultaneously released to the public, in advance of official publication in the Federal Register, their latest proposal to define "gainful employment in a recognized occupation."

As was the case with a prior 2010 proposal which was vacated by the courts, the Administration is proposing a series of debt-to-earnings and student loan repayment metrics which would be used to determine if select programs at public and private non-profit, and the overwhelming majority of programs at for-profit institutions – including all disciplines within the cosmetology arts and sciences – should be eligible to receive and administer federal student financial assistance.

The American Association of Cosmetology Schools (AACS) has actively engaged in both the preceding and more recent negotiations, and upon initial review of last weeks' Notice of Proposed Rulemaking (NPMR) are pleased to see that the recently published proposal contains significant revisions from prior iterations that are more equitable for students and schools.

 While acknowledging these important modifications, the American Association of Cosmetology Schools remains bullish in their view that the Department is premature in attempting to promulgate these regulations because they have failed to provide complete and comprehensive information on the effects of the regulations on impacted parties – thus prohibiting those institutions and programs from truly making informed decisions on how to provide constructive recommendations to the regulatory package.

 "It is clear that the Department and the Administration listened to some of the concerns expressed by the negotiators and made some important changes based upon the higher education communities' suggestions," said AACS Executive Director, Jim Cox. "But it is still unclear to us, and our membership, the full impact of this proposal because the data the Department has provided to this point – including the data provided with the NPRM – are woefully incomplete."

 Analysis conducted by AACS of both the data provided by the Department at the final session of the recent negotiations, and last weeks' release of new 2012 GE Informational Rates, continue to show omissions in the data for several metrics at levels at or in excess of one-quarter to one-third of the programs, and in some isolated incidents the levels are as high as seventy-five percent and higher. AACS asserts that, given this level of ambiguity and incomplete/inconclusive information, the Department should withhold further drafting, consideration, and promulgation of final regulations until such time as the Department can provide an accurate and complete representation of all programs subject to the NPRM.

 "If the roles were reversed, and the Department of Education was conducting a Student Financial Aid audit or program review of any institution of higher education, and that institution provided information with as many holes as the Department's data continues to have, the Department would immediately call into question the Administrative Capability of the institution, and would – understandably – take expedited steps to Limit, Suspend, or Terminate that institution's eligibility to participate in the Federal Student Financial Aid programs."

 "It seems counter-intuitive to us," said Gregory Jones, AACS Government Relations Committee Chairman, "that the Department and the Administration would seek to develop such important regulatory policy in a matter completely and utterly inconsistent with the very process and standards upon which they evaluate us."

 AACS will continue to promote these concerns in its comprehensive response to the NPRM – along with comments and recommendations specific to the proposal – and looks forward to continuing to work with the Department and the higher education community on the development of this, and other key regulations (Violence Against Women Act and Program Integrity and Improvement) in which the association is also actively engaged.

Visit AACS for updates here: ww.beautyschools.org/

For other legislative alerts and updates, visit the MODERN SALON resource page.